contract | In Principle

Art. 6491–6495 of the Civil Code is intended to ensure that the security in the form of a payment guarantee for construction works provided at the investor’s request secures timely payment of the contractor’s fee. However, one may suspect that in practice this instrument is used for a completely different purpose.

The parliament has granted subcontractors a high level of protection. The provisions on joint and several liability are strict for the investor and often in practice mean a risk of double payment for the same thing: the first time to the general contractor and the second time to the subcontractor. Therefore, the investor should be able to recover from the general contractor the sums paid directly to subcontractors.

The Public Procurement Law provides for rules autonomous from the Civil Code for settlements with subcontractors. The regulations apply independently of each other, but they are applied in parallel to contracts concluded under the public procurement regime.

W polskiej praktyce obrotu gospodarczego od dłuższego czasu budzi wątpliwości możliwość skutecznego wprowadzenia w umowach o roboty budowlane klauzul nakładających na jedną ze stron kontraktu obowiązek powiadomienia drugiej strony o okolicznościach uprawniających do żądania dodatkowej zapłaty za wynagrodzenie. Klauzule te wywodzą się z kontraktów zawieranych na wzorcach umownych FIDIC, opracowanych przez Międzynarodową Federację Inżynierów Konsultantów.

The question of payment of the cost of alterations made to leased premises by a tenant is an important issue in the relationship between the tenant and the landlord. There are many factors affecting arrangements as to the cost of alterations, such as the duration of the lease, the premises leased, and the envisaged outlays on the part of the tenant.

Disputes concerning indemnity arise under an agency agreement. This payment does not become due automatically, as there are certain requirements. This payment is due on the basis of equity and is intended to give an agent a share in the profits they help to generate.

The unique characteristics of public procurements should not impede a balanced allocation of risks between the parties. However, despite efforts by various groups this goal has remained unattainable. The drafters of the new Public Procurement Law have recognised the problems related to the parties’ unequal positions and proposed several remedies.

The Act on Consideration of Complaints by Financial Market Entities and on the Financial Ombudsman provides that a complaint not resolved within the stated period “is regarded as” resolved in accordance with the customer’s request. In a surprising resolution, the Supreme Court recently ruled that this does not mean that a delay in consideration of a complaint mandates that it is resolved in the customer’s favour, but such a delay merely increases the burden faced by the entity during litigation. If, of course, the matter ever reaches the courts. Was this what the legislature intended?

The consequences of a transaction falling outside the scope of business specified in the articles of association.

In common-law jurisdictions, the trust is a popular form for achieving various aims: managing assets, inheritance, building corporate structures, and tax planning. But countries from the Continental legal tradition, like Poland, typically do not have any institution directly corresponding to a trust. Polish doesn’t even have a word for it. This has raised doubts over the years and sometimes even suspicion on the part of courts and lawyers when they need to determine the consequences exerted by a trust in actual or potential disputes in jurisdictions unfamiliar with this form. Are their suspicions well-founded?

During the course of construction projects, issues often arise involving additional work or substitute work. Contractors perceive even minor departures from the original plans as additional work and demand an increased fee, while investors not only expect all their instructions to be followed within the agreed price, but treat any opposition by the contractor as a breach of contract. This dynamic works similarly between the general contractor and subcontractors. But the realities of the real estate development process often require work to be done even when the parties take different views of the work and do not sign a separate contract covering it. Is an additional fee nonetheless owed for performing such work?

A year has passed since introduction into the Polish civil law of revolutionary but not widely noticed changes in the form of legal transactions. A few examples will illustrate how important these changes are.